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Tencent versus Facebook?

2014-02-21 09:57 chinadaily.com.cn Web Editor: qindexing
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Facebook Inc will pay $19 billion in cash and stock for WhatsApp, a popular smartphone messaging service.

The lofty price tag shows the world's largest social network's determination to boost its mobile messaging service, a demographic where Facebook's influence has begun to wane.

As the company gains an advantage in tapping into a new and relatively large group of youngsters actively messaging each other, WeChat, the mobile messaging application from China's Internet giant Tencent, which is also aiming to woo the same demographic in the US market, faces a stronger rival now.

WeChat first went global in 2012. It has since made a splash in many emerging markets, including Southeast Asia and Latin America. However, capturing the US market can be difficult, according to Cao Junbo, chief analyst of iResearch Consulting Group.

"All the most popular mobile messaging apps in the world have their own territories. WeChat dominates Chinese mainland market while apps like Line and Kakaotalk have their faithful users in Japan, Korea and other Southeast Asian countries. Whatsapp is the most-commonly used messaging app in the US and Europe".

"It will be hard for any of these services to tap into other markets because users from different cultures have different habits and preferences when it comes to mobile messaging", said Cao. "The apps that dominate Asian market provides social platform, games and other services while Whatsapp only provides messaging service".

Kelly Turketo, an Australian who has been living in Beijing for almost a year, said she prefers WeChat over Whatsapp. "I guess Whatsapp and WeChat are similar except WeChat has awesome animations. My Aussie girlfriend just downloaded it and she loves the animations. Now she's always sending them to me."

George Dufournier, an event planner who works with mostly teens in Miami and currently lives in Beijing, said he likes WeChat. "It's a great combination of social networks and instant messages", "I use Facebook mostly back in the US because it's easier to create events and pages so people can confirm if they are coming to an event or not. People in the US use Whatsapp when they have friends overseas. I didn't use it often back home because my mobile-phone plan offered me unlimited texts facility."

"I can definitely see WeChat's potential in the US market, but it might take time for it to gain popularity", he said.

Lu Gang, the founder of Technode.com, the official partner of TechCrunch in China, said he hopes to see WeChat expand its presence in global market but expresses concerns.

"It has a great potential if it pushes harder. However, out of the 100 million overseas users it has, we don't know how many are living in China. It will be even more difficult for WeChat to compete with Whatsapp now since Facebook is backing it", Lu said.

According to Wired, Facebook admitted on a recent earnings call that teenagers are spending less time on its service, and a tool like WhatsApp is a way to attract the much sought-after demography.

The service now spans 450 million monthly users, and about 70 percent of them are active on any given day, Facebook said.

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